Shares of TripAdvisor (TRIP) have made a zigzag recovery over the past six to seven weeks, but in the context of a two-year downtrend. Where are we headed next?
In this daily bar chart of TRIP, above, we can see gaps to the downside and the upside, and big swings in the 50-day moving average line. The longer-term, 200-day moving average line has been in a downtrend for the past year. The On-Balance-Volume (OBV) line has been moving irregularly lower since last June.
Looking closer at the modest price improvement over the past six to seven weeks, we can see how prices worked higher, but there was only limited improvement in the OBV line and momentum, making a lower high versus the higher high in prices. This bearish divergence versus momentum and the limited buying interest suggest that TRIP's two-year decline is still not over.
In this longer-term chart of TRIP, above, we can see a double top at $110 and a long zigzag decline, with a declining 40-week moving average line. Prices have been cut in half from that $110 zenith.
Read Bruce Kamich's analysis of Expedia here.
The OBV line on a weekly time frame is neutral or inconclusive. Also in the bottom panel, we find no bullish divergence between lower prices and the momentum study on a weekly time frame. Looking at the combination of these weak conditions, I would look for TRIP to retest the $60 level and perhaps lower in the days and weeks ahead.